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Monte Titoli, the Italian settlement agency, has called an emergency meeting after several of its member banks flouted normal business procedure, causing its electronic system to crash. It has threatened banks with fines, suspension or exclusion.

On Wednesday, the settlement agency put out a notice to customers after its Express II electronic settlement system suffered breakdowns on Tuesday and Wednesday.

The statement said the problems were caused "by behaviours, incompatible with the normal and smooth operation of the settlement systems, adopted by a small number of settlement agents".

Monte Titoli said it had failed in its informal attempt to stop the offending banks from irregular behaviour.

The statement said: "Their unaltered behaviour now induces Monte Titoli to consider which are the best actions to prosecute them." It said the measures enforced by next week's meeting would not be retrospective.

Paolo Cittadini, general manager of Monte Titoli, said the group had called an Express User Group meeting next week.

The user group, which oversees the smooth running of Monte Titoli, will discuss changes to its rules and censures for offences that destabilise the system.

Monte Titoli's system had been struck by a string of technical glitches following its full launch in January 2004. Four days after full launch, it was hit by IT problems that meant trades failed to settle and that sent volumes in government bonds down by 50%.